The e-commerce One Stop Shop (OSS) is a simplified system for accounting for VAT on the distance sale of goods and to customers in the EU. Once registered for the OSS, businesses need to file a single OSS VAT return accounting for their e-commerce sales throughout the EU.
The OSS will be a welcome innovation for many e-commerce businesses. Instead of registering for VAT in multiple countries, and filing multiple VAT returns, the OSS simplified and streamlined the VAT compliance process. Here’s how it works in practice.
Union and non-Union OSS schemes
You do not have to be established in the EU to register for the OSS. However, there are different protocols depending on where you register your business.
Businesses not established in the EU will, under certain circumstances, register for the non-Union scheme. (Specifically, for the sale of certain digital services). When registering for the non-Union scheme, you may be required to demonstrate that you are not established in any EU state.
Moreover, non-EU businesses may, under certain circumstances, need to appoint an intermediary to register for the OSS.
Which country to register for the OSS
If your business is established in the EU, you must register for the OSS where your business is established.
If your business is established outside the EU and you have fixed establishments in one or more member states, you must register where you have a fixed establishment.
The OSS does not replace your domestic VAT return
Note that the OSS applies to distance selling. Even if you registered for the OSS, you still need to file your domestic VAT return as normal.
What are your obligations when registered for the OSS?
Once registered for the OSS, you must charge and account for VAT accordingly.
Sellers must therefore:
- apply the VAT rate of the country where the goods are being dispatched to at the point of sale
- submit a quarterly digital VAT return through the OSS portal
- make a quarterly payment of declared VAT to the country in which you are registered
- keep records of applicable sales for ten years
A complete OSS solution
The OSS promises to make VAT compliance considerably simpler for e-commerce businesses selling to customers in the EU. Invariably, however, the new regulations also create their own compliance challenges and complexities.
Vatglobal makes it all easy. Our specialist VAT team will provide full clarity and guidance on all your VAT obligations. We can even manage all registration and compliance requirements for you, including acting as an intermediary if required. Get in touch with Vatglobal for a truly simple e-commerce VAT solution.